Thursday, March 22, 2012

A wrap-up of the 2011-2012 legislative session from Michael Vickerman:

As RENEW Wisconsin’s new Program and Policy Director, I would like to report on recent results of the 2011-2012 legislative session. Though the session as a whole presented Wisconsin’s renewable energy community with unprecedented challenges and a few setbacks1, we were able to fend off a number of bad proposals in the final days. Had these proposals been adopted, Wisconsin’s ability to support and host investments in renewable energy would have been permanently damaged.

Wind-siting
As you probably know, the Legislature adjourned March 16 without taking any follow-up action on the wind siting rule (PSC 128). In doing so, the Legislature allowed the rule, which had been in a state of suspension for more than a year, to take effect. PSC 128 is now in effect, and it can’t be suspended by future Legislatures. More than four years has elapsed since RENEW spearheaded the process of forging a coalition (initially called the “Campaign for Sensible Wind Permitting”) to pass a bill requiring uniform standards for permitting wind turbines. Much blood, sweat and tears went into that legislative campaign (renamed “Wind for Wisconsin”) which culminated in the passage of 2009 Act 40 with bipartisan support. Then followed the drafting and redrafting of the siting rule itself, which proved to be more difficult process than we had first imagined.

Nevertheless, the PSC issued a strict but workable rule in December 2010. Even though what had emerged from the rulemaking process was a product of compromise and deliberation, the rule came under fire virtually the moment the Legislature convened in January 2011. After holding a stacked-deck hearing in February, the Legislature suspended PSC 128 on March 1, the day the rule was to take effect. Shortly thereafter, antiwind legislators circulated bills to repeal the rule outright (SB 50 and AB 72).

On a separate track, Sen. Frank Lasee, a Republican from Brown County, introduced a series of bills aimed at permanently crippling the wind industry in Wisconsin. Though these bills went nowhere, they succeeded in presenting an unwelcoming face to wind developers, and they responded by suspending or cancelling about a half dozen prospects throughout the state.

By March this year, it seemed to us that the momentum had shifted in our favor. Since the suspension of PSC 128, more than 17 or so newspapers had written editorials decrying the destructive nature of Lasee’s jihad and reiterated their support for a clear and consistently applied permitting process – exactly what PSC 128 rule was intended to provide. The signals coming from the legislative leadership strongly suggested that none of the antiwind bills referred to committee, including SB 50, the senate bill to permanently repeal PSC 128 and direct the PSC to issue a new rule , would be scheduled for a floor vote in the final two weeks of session.

But something happened around March 1st that changed the political calculus, and to everyone’s surprise, SB 50 appeared on the Senate calendar for the week of March 5. Theories abound as to why Majority Leader Scott Fitzgerald reversed himself and allowed SB 50, which the wind industry viewed as the functional equivalent of a death warrant, onto the Senate floor. Unconfirmed reports attribute this last-minute switcheroo to extreme pressure that Sen. Lasee and his allies (former senator Bob Welch, now lobbyist for the Brown County antiwind group, and the Wisconsin Realtors Association, which had contributed generously to Republican office-seekers in the fall 2010 elections) exerted on Sen. Fitgerald.

When the Senate took the floor that Tuesday, the outlook looked grim. It appeared that the antiwind faction had at least the minimum 17 votes required to pass the bill. Wind energy supporters had little time to turn an unpromising situation around and build a firewall of support. But in those few hours they succeeded in denying Sen. Lasee the 17th vote he needed to send this bill to the Assembly. The following day, Lasee admitted defeat, and SB 50 was referred back to committee, a startling turnaround from the situation 24 hours earlier. The bill stayed there until its death the following Thursday, when the State Senate gaveled itself into the history books.

Notwithstanding PSC 128’s roller coaster ride culminating in the late-session cliffhanger vote that staved off its repeal, Wisconsin can now say, for the first time since 2007, that it is open for business in the wind energy development arena.

We are indebted to the law firm of Cullen, Weston Pines and Bach for their heroic efforts in keeping wind development alive in Wisconsin. Special thanks are in order for Lee Cullen, Jeff Vercauteren, Curt Pawlisch, and Chris Kunkle for building a firewall of support for PSC 128 that held firm under the extreme pressure applied by antiwind forces.

AB 146 (Extending the Life of Unused Renewable Energy Credits)
Under current law, a Wisconsin electric provider can bank an unused Renewable Energy Credit (REC) for up to four years before using it to comply with Wisconsin’s Renewable Energy Standard. If not used within that four-year window, the REC expires. Last May, a bill was introduced (AB 146) to eliminate the shelf life of an unused REC. Passage of this bill would allow REC’s to be bankable into perpetuity, which would have the effect of diminishing the need for new sources of renewable electricity.

The Assembly Energy and Utilities Committee held a hearing on the bill in September. Among those in support of AB 146 were Wisconsin Utilities Association and various individual utilities. Among those joining RENEW in opposition to the bill were the American Wind Energy Association, Wind on the Wires and several independent wind developers; Wisconsin Counties Association; several private waste haulers; Dairy Business Association; Clean Wisconsin; Sierra Club; Citizens Utility Board, and the American Lung Association in Wisconsin. As events unfolded, the committee never did vote on AB 146. The bill died last Thursday, and is not likely to be resurrected in 2013.

Allowing Third-Party Sales of Energy to Host Customers
In an effort to expand and invigorate small-scale renewables in Wisconsin, RENEW asked two legislators (Rep. Gary Tauchen of Bonduel and Rep. Chris Taylor of Madison) to sponsor the drafting of legislation to authorize sales of energy from third party-owned renewable energy systems to host customers. The legislation would accomplish that objective by exempting renewable energy systems that serve the owners of the premises where they’re located from being regulated as public utilities. The exemption would be narrowly constructed to restrict the sale of that energy only to the host customer or the local utility.

Last Thursday, the Legislative Reference Bureau produced a revised bill draft that appears to be ready for introduction ... next year, when a new Legislature is convened. In the meantime, RENEW plans to solicit support for this bill from such influential constituencies as farm groups, local governments, WMC, and large commercial enterprises. While the utilities may not support this kind of legislation, they could decide not to oppose the bill, especially if we build a bipartisan coalition of supporters.

1 In June, the Legislature took two steps back on renewable energy policy. First, it passed a bill watering down the state’s Renewable Energy Standard by allowing large-scale Canadian hydroelectric generation to become eligible renewable energy generators. Later that month, the Legislature approved a substantial cut to the annual budget of Wisconsin’s Focus on Energy program. The budget for 2012 will be $20 million less than last year’s budget, which will diminish the supply of financial incentives available to support customer-sited renewable energy systems.